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Elasticity of supply is a measure of the way suppliers respond to a change in price. Please select the best answer from the choices provided

a. True
b. False

User Sapsi
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2 Answers

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I am pretty sure it is true.
User Gregori
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Answer: false

Both producers and resource suppliers can respond to a change in price.

Step-by-step explanation:

Elasticity of supply also called price elasticity of supply is the measure of the responsiveness of producers and resource suppliers to a change in price of the produce.

Mathematically, it can be defined as the ratio of percentage change in quantity of goods and services supplied to percentage change in price.

Price elasticity of less than one indicates an "inelastic" supply. When elasticity is greater one, the supply is "elastic" while zero price elasticity signifies a "fixed" supply.

Availability of raw materials, length of production, time to respond, number of producers, storage availability and ease are some of the factors that determine elasticity of supply.

User Bins Ich
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